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1
ABSTRACT
ORGANISATION.
subsequently the derived feedback from the process have recently derived attention from both
researchers and the management of any organization (). However the knowledge of gaining the
trust of employees as well as getting the appropriate feedback is seriously lacking. This thesis
tried to review the attitude of employees to work as a result of performance appraisal within an
organization.
PURPOSE: To review the effects of performance appraisal on employee work performance and
work effectiveness.
METHOD: The primary data for this work was collected from the survey received from the
employees of Unique Assurance Company and also secondary data was collected from journals,
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KEYWORDS: Work Performance, Performance appraisal, employees attitude,
motivation
ACKNOWLEDGEMENT
To God for his Provision, Guidance and Strength through our stay in Sweden.
Per Eisele our supervisor, who has encouraged us through the process of this research. And also for his
To our friends and loved ones in BTH who helped directly and indirectly in the completion of our thesis
Also special thanks to the employees of Unique Assurance Company for their time taken out to answer
our questions
………………………………… ………………………………
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TABLE OF CONTENTS
CHAPTER 1 5
INTRODUCTION 5
1.1 Background of study 6
1.2 Research Questions 7
1.3 Objectives of Study 8
CHAPTER 2
2.1 The performance appraisal Paradox 9
2.2 Approaches to Performance Appraisal 11
2.3 Performance and Leadership 13
2.4 Feedback in Performance Appraisal System 15
2.5 Feedback Types 17
2.6 Sources of Performance Appraisal and effects on employees 19
2.7 Factors affecting Feedback Process
2.8 Employees Attitude Towards The Content Of A Performance Appraisal 20
CHAPTER 3 30
3.1 Case Study Overview 31
3.2 Appraisal System in Unique Assurance Company 32
3.3 Research Methodology 41
CHAPTER 4 42
4.1 Data Presentation 42
4.2 Data Analysis 42
4.3 Test of Hypothesis 47
CHAPTER 5 54
5.1 Findings of the research 54
5.2 Recommendations 55
5.3 Conclusion 56
References 57
List Of Figures 62
Appendix 63
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CHAPTER ONE
Evaluation of jobs in any organization is one area that an organization‘s human resource
department does not neglect because it helps to keep employees in check of what they are to do
on the job how the job is been carried out.(See Derven 1990) This chapter introduces the
INTRODUCTION
processes for determining staff accomplishments to improve staff effectiveness (Winston, R. B.,
Jr, & Creamer, D. G. (1997).) It is extremely important that workers have the proper
knowledge, skills, and attitudes to perform well in their jobs. Knowledge, skills, and attitudes are
the internal competencies that workers bring with them to the job or that they must learn through
training. The above mentioned abilities are not however the only factors that go into success at
getting the job done. Factors that are external to workers, such as the environment, standard
operating procedures, customers, equipment, and management‘s own behaviors, can have a big
Performance appraisal systems are generally seen as simple methods of income justification. The
process was firmly linked to material outcomes. It is also generally used for administrative
decision purposes such as pay raise, termination and to a large extent it is needed for a
company‘s development. A good performance appraisal creates an avenue for the formal
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recognition of the employee i.e. receiving a positive feedback serves as a moral boost that the
employee is contributing positively to the organization but on the other hand a negative feedback
Uses for performance appraisal have included equal employment opportunity considerations,
promotions, transfer and salary increases. Primarily, performance appraisal has been considered
an overall system for controlling an organization. It has also been called an audit function of an
Almost every organization in one way or another goes through a periodic ‗ritual‘, formally or
informally, known as performance appraisal. In spite of what the organizations intention are
when conducting performance appraisal it produces a feedback that can either be positive or
The feedbacks received can either help in organization development or serve as a drawback to
effectiveness and efficiency in the work place. The effects of feedback have historically been
quite varied and largely ignored. In some studies, feedback has been found to improve
performance (e.g., Arps, 1920; Brand, 1905) its root has been traced to the 19th century during
Taylor's pioneering Time and Motion studies. Performance appraisal has been called many
names such as a tool of management, a control process, an activity and a critical element in
human resources allocation. If an employee's performance was found to be less than ideal, a cut
in pay would follow. On the other hand, if their performance was better than the supervisor
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expected, a pay rise was in order. The post effect (i.e. after effects) of these performance
Appraisal seems to be inevitable and universal, and in the absence of a carefully structured
system of appraisal, people will tend to judge the work performance of others, including
appraisal is of great importance to any organization in achieving its efficiency and effectiveness,
there are various controversies on the issue which includes many reputable sources - researchers,
management commentators, who have expressed doubts about the validity and reliability of the
performance appraisal process. Some have even suggested that the process is so inherently
flawed that it may be impossible to perfect it (Derven, 1990).Performance appraisal also has its
positive and negative effect on the workers which the employees might view as testing their
effectiveness.
Based on the discussion above the aim of this research is to gain a better understanding of
employees‘ reaction to performance appraisal and their subsequent attitude to work. Performance
appraisal may face a general acceptance or rejection from employees this may be due to the fact
that employees sees appraisal as an avenue to lay-off workers that falls short of expectation. The
major question this research seeks to answer helps to shed more light on the problem and how it
organization?
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Hypothesis
There are five main hypotheses to be tested in other to gain adequate understanding of the
research
Hypothesis One: The changes in the attitude of employees as a result of performance appraisal.
Hypothesis two: Performance appraisal is believed to have more negative effects on employees
Hypothesis Three: Performance appraisal does not bring unhealthy competition among
employees
The objective of this study is to know how employees in an organization react to performance
appraisal in relations to how they react to feedbacks from the appraisal and also to know which
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CHAPTER TWO
For more than fifty years, performance appraisal has been firmly outlined as a personnel
(Rasch 2004) the process of performance appraisal is designed to address problem behaviour and
there is an underling assumption that all employees in an organization must undergo this
Scholtes (1999) observes that despite the various uses of performance appraisal such as its uses
overview of the practices and key components in performance appraisal processes such as
feedback, learning, and teamwork in the performance appraisal process, most people still lack
confidence in the whole process. he based his argument on the survey conducted in 1996 by the
Society for human resource management that found out that over 90% of performance appraisal
has been unsuccessful which is due largely to the feedback received from the process and he
Many researchers have indicated that reactions to performance appraisal by employees plays an
important role in employees appraisal process because they are very vital for the organizational
acceptance and use of the appraisal system (such researcher include Bernardin &Beatty, 1984;
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Assessing the feedback of performance appraisal is also the assessment of employees‘ reaction
towards performance appraisal. According to Lisa (2000) assessment of this reaction is important
(a) The reactions from performance appraisal represent a criterion of great interest to
practitioners.
(b) The reactions has also been theoretically linked to determinants of appraisal acceptance and
The lack of a feedback process in performance appraisal creates a gap when evaluating
employees‘ performance. This gap has subsequently been called criterion gap. In relation to the
gap created, Balzer and Sulsky (1990) suggested that the existence of a criterion gap in
performance appraisal originates from two sources. The first source been that many of the
dependent variables measured in performance appraisal are of little interest to analyst. Secondly,
many of the dependent variables that are of interest to analyst are mostly or completely ignored
by people carrying out the researches. In general, researchers focus on measuring the
psychometric properties of ratings, whereas analyst are more often interested in practical criteria
such as appraisal reactions from feedback (Cardy & Dobbins, 1994;Murphy & Cleveland, 1995).
Although this gap is an important part of the feedback and performance appraisal process it will
According to (Sundra 2003), the success or failure of any performance appraisal is attributed to
A first criterion is based on Murphy and Cleveland (1991) argument on reliability issue.
They proposed that reaction criteria e.g. the perceived fairness or accuracy of the system
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Secondly, the practicality criteria of performance appraisal include widely recognized
The third sets of decision process criteria concerns the level of acceptance by member
These sets of criteria are considered indirectly by the management of Unique Assurance since
noted that performance appraisal in most organization is an ongoing event be it periodically and
not a single event. Appraisal activity generally focuses on staff improvement and not salary
adjustment which might be a form of reward or disciplinary action. Some of the approaches
outlined by Creamer and Janosik (in press) include behaviour based approach; results focused
A) Behavior-Based Approaches -: This is the type of performance appraisal that uses specific
performance factors to evaluate employees. This approach is further divided into the following:
Conventional Rating Scale: This rating scale uses a specific word or phrase to describe the
extent to which certain behaviors are displayed .The characteristics of such behaviors are
displayed in the job description. In a situation where there are no behavior descriptions, the
supervisors work with other employees to determine behaviors that would be useful to determine
appraisal setting.
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Behaviorally Anchored Scale-This approach occurs as a result of collaboration between the
supervisors and other employees where broad categories of practice are identified. The measure
Behavior-Based Appraisal: This is an approach that is based on how often employees display
specific behaviors and they are evaluated on how often the behavior occur. it is the behavioral
frequency scale.
The weighted checklist: This is another way of approaching behavior-based appraisal. In this
method, employees are judged on a scale indicating the extent to which the statement accurately
describes their performance according to a list of performance related statements that are
weighted.
Forced-choice method: In this approach, there is a form of calculation on a grid that calculates
job performance based on the employee level of discrimination and desirability on the job. It is a
list of performance related statements about job performance and are evaluated on how well they
B) Results-Focused Approaches -: This is the type of approach that focuses on the result to be
derived from the appraisal. Creamer and Janosik (in press) noted both advantages and
produce short and long term results in achieving the performance and organizational objectives,
and are generally perceived as fair, and also tend to generate high levels of commitment among
the employees to the organization, and they encourage a high level of participation and are thus
defensible. And the disadvantage been that, they can be overly results oriented and they are
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mostly inflexible. Before an organization can adopt this approach, the management must be of
the view that the advantages outweigh disadvantages, for the approach to be incorporated. There
C) Accountabilities and Measures approaches: This approach involves the supervisor and the
other employees agreeing on accountability, fairness and performance factors and including such
factors in the job description. Performance is then forecast for each factor to enable quantifiable
measures for each factor. An Accountabilities and Measures form can be created, with
Although the case study of our research does not use a specific one out of these set of
performance appraisal type since their performance appraisal is carried out quarterly but from
our research, we discovered that the company tend to use more of the Result Based Approach.
This is because the judge an employees based on the result he/she achieved from a project.
In most cases for and performance appraisal to be considered as fair the leadership conducting
the process must be perceived in a positive light. This helps to determine that there is appositive
relationship between Performance and leadership. Ultimately it is the individual employee who
either performs, or fails to perform; a task but motivation on the part of the leader can ensure
performance of any task. In order for an organization to perform an individual must set aside his
personal goals, to strive for the collective goals of the organization (Cummings and Schwab,
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organization itself (Cummings and Schwab, 1973). Employees and their attitude to work are of
paramount importance to the achievement of any organizational goals. Thus, effective leadership
enables greater participation of the entire workforce, and can also influence both individual and
It is generally believed that the success of an organization is largely dependent the leader‘s
ability to optimize human resources (i.e. its employees). A good leader understands the
achieving these set goals and objectives. In other for any organization to have an effective and
efficient work system, the people within the organization need to be inspired to invest
themselves in the organization‘s mission (this inspiration can be achieved through effective
performance and reward system): the employees need to be stimulated so that they can be
effective; hence an effective organizations requires an effective leadership (Wall, Solum and
Sobol, 1992; Maritz, 1995). To have an effective organization, there must be effective and
stimulating relations between the people involved in the organization (Paulus, Seta and Baron,
1996).
It has been widely accepted that effective organizations require effective leadership and that
organizational performance will suffer in direct proportion to the neglect of this (Fiedler and
House, 1988). Furthermore, it is generally accepted that the effectiveness and efficiency of any
set of people is largely and mostly dependent on the quality of its leadership an effective
leader‘s behavior facilitates the accomplishment of the follower‘s desires, which then results in
effective performance (Fiedler and House, 1988; Maritz, 1995; Ristow, et al., 1999
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Leadership, according to(Cummings and Schwab, 1973). is perhaps the most thoroughly
investigated organizational variable and that this fact has a potential impact on employee
performance. An efficient leader understands that employees‘ motivation as well as strength and
weaknesses has a major influence on their decision making, actions and relationship.
―There is agreement in the literature (Maritz, 1995; Bass, 1997) that leadership is a critical factor
leadership, and successful organizations therefore reflect their leadership. Leaders are effective
when the influence they exert over their subordinates works towards achieving organizational
performance.‖ (Jones and George, 2000).In recent times, leadership is often regarded as the
single most important factor for the success and failure of any organization. (Dimma 1989)
believes that it is undoubtedly the critical determinant of the success of an organization and to
performance.
In performance appraisal one of the most important aspects of the program is when the
employers communicate their performance ratings to the employees. Although some researchers
like (Ammons 1956) claim that the feedback process in performance appraisal has little or no
effect if the person is already performing on a high level or if the job is complex. The feedback
delivery helps the organization in decision making, enhancing of productivity and effectiveness
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within the organization. It has been pointed out that the communication of feedback regarding
The aim of any organization when conducting performance appraisal is to receive feedback and
this feedback helps to maintain and direct employee behaviour to accomplishing the
organizations goal and objective and also mating a high level of work to accomplish these goals.
On the part of the employees performance appraisal feedback serves as a means of satisfying the
need for information on how employees are meeting up with their personal goals and as serves as
a form of social measurement among their peers. Feedback serves as a basis for identifying
discrepancies self and others‘ performance and work goals (Carver, Scheier 1981)
From both the organizations and employees point of view a performance appraisal feedback
process can serve as a means of identifying the employee‘s weakness and unidentified goals.
Identification of these shortcomings can help the employees to increase their level of
performance, redirect their efforts toward achieving both the organizational and personal goals,
and also improve their relative standing to internal and external standards. This achievement is of
great important to the organization however, performance appraisal feedback has not only leaded
directly to the improvement of performance. Research has shown that the success of the
feedback depends on a number of factors related to the acceptance of the feedback process which
can include: the valence of the message(positive or negative) characteristic of the source(e.g.
knowledge, credibility, familiarity of the job), and the recipient of the feedback and also the
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behaviour(Fisher , Taylor1979,Zuber ,Behson 1998).The level of acceptance of feedback is then
For any feedback within the organization to yield any positive result, the source of the feedback
must be perceived by the recipient as being trustworthy, credible, reliable ,objective and properly
motivated in other for feedback to be accepted.(Wyer, Budeshiem, Lambert, Swan 1994).On the
other hand the degree of the feedback‘s acceptance is greatly reduced when the source of the
feedback is perceived as unreliable, untrustworthy or has having ulterior motives. When the
feedback received from employee indicate that an employee has performed above the
organizations standard, it is generally perceived that individual goals on subsequent work will be
stable i.e. there is high motivation on the part of the employee to work. On the other hand when
there are negative discrepancies between the employees‘ goals and organizational goals,
Invariably, individuals that receive negative feedback are more likely to put more effort to
improve their performance than individuals than individuals that received a positive feedback.
Based on the performance appraisal dimension, different types of feedback are delivered.
Classifying types of feedback based on the nature of performance helps to understanding the
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et al.‘s feedback process model, (1979), the features of each feedback source combined with the
form of feedback that best corresponds to each source‘s characteristic should yield the greatest
This process evaluates the behaviour representative of one team player style called the
communicator. The main aim of the communicator it to facilitate the on time completion of task
by the team and accomplishment of its goals, Other roles of the communicator includes active
listening and involvement in the resolution of conflict within the team. The communicator also
helps to create an informal and relaxed atmosphere among team members. This performance
dimension evaluates and assesses employees‘ behaviour while working together as a team in
accomplishing a task. In this performance dimension, peer might be in the best position to give a
more accurate and objective and more reliable performance rating on team process system.
This other performance dimension evaluates the nature and content of the outcome of the tasks
performed specifically in the terms of the quality and quantity of the final products produced by
the employees. In the case of task outcome performance, the supervisor might be in the best
position to judge behaviour or final outcome given the supervisor‘s expertise is in the field and
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ability to judge the quality of task outcomes leading to a higher level of feedback acceptance by
the employees.
EMPLOYEES.
introduced multi source appraisal and feedback programs.(Albright & Levy 1995).In the multi
source appraisal program, Employees receive evaluation and feedback from not only their
supervisors but also from other sources such as peers, subordinates and even their customers.
This form of performance appraisal came up as result of increasing number of responsibility and
task for the supervisor and well as increasing number of subordinate. Another contributing factor
to the effectiveness of this program is the continuous flattens of the hierarchy within the
organization that might make it more difficult for supervisors to assess their subordinate. (Cascio
1995).
While some organizations are aware that their performance evaluation is multi sourced, some
organizations are unaware of this fact. An appraisal program is considered multi sourced if more
than one source in evaluating employees or considers all the sources like customers peers etc.
The aim of consulting as many sources is to allow employees obtain true feedback reflecting
their true ability on the job and also help judge a wider variety of behaviour on the job that might
not be displayed by the employee during the period of appraisal. The feedbacks on this form of
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According to (Dunntte 1993, Facteau et al 1998, Fuderburg & Levy 1998, London and Smither
1995), Multi source performance appraisal has received attention from both managers and
academics. Though the program has led to many researches, many issues still remain unresolved
Satisfaction
One of the most frequently measured appraisal reaction is Satisfaction (Giles & Mossholder,
satisfied, serves as a report of the accuracy and fair evaluations of performance, and the feel that
In the same view, Taylor et al. (1995) conceptualized satisfaction with a four-item scale of
assessing: whether the organization should enhance or change the appraisal system, whether
there are less work problems arising as a result of the performance appraisal system, whether
employees are satisfied with the way the organization conducted the appraisal, whether having
This measure may potentially fail to distinguish between satisfaction and utility. Lastly, some
satisfaction measures seem to also fail to distinguish between appraisal satisfactions with job
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satisfaction. For example, Dorfman, Stephan, and Loveland (1986) measured appraisal
satisfaction by having employees respond to the following questions: "How satisfied were you
with the discussion between yourself and your supervisor about your job performance?", "In
general, how satisfied are you with your supervisor?", "In general, how satisfied are you with
your job?", and "How satisfied are you with the overall evaluation of your performance?
These questions are too direct and does not necessarily address appraisal but rather seems to be
Fairness
Assessing the appraisal fairness is a more complicated phenomenon compared to other reactions
from performance appraisal. This is due to the influence the organization justice has recently on
measuring employees‘ reaction to performance appraisal. This argument is in line with Smither‘s
(1998) that a good appraisal system is of great sensitivity to issues of justice or fairness.
In the past, appraisal fairness was viewed as either the perceived fairness of the performance
rating or the perceived fairness of the appraisal in general. In recent times however, researchers
in performance appraisal have brought to life the concepts of procedural and distributive justice
and have used these measures to assess and justify the issue of fairness (e.g. Korsgaard
&Roberson, 1995).To this effect, appraisal fairness has been interpreted in four different ways:
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Perceived Utility
One of the popular reactions to performance appraisal is the utility of the appraisal
In comparison with satisfaction and fairness, the measurement of perceived utility has been
relatively consistent and uncompounded. The most typical idea of perceived utility has focused
on the usefulness of the appraisal system. ―For example, Greller (1978) conceptualized utility in
terms of the appraisal session and operational zed this with items such as "The appraisal helped
me learn how I can do my job better" and "I learned a lot from the appraisal.‖.
Perceived Accuracy
In reviewing any performance appraisal, perceived accuracy has to be used as a criterion because
it presents an unusual case when compared to other typical reactions that are measured.
―Cawley et al. (1998) reported that the vast majority of studies appear to confound accuracy with
other reactions, most notably fairness‖. In this study the employees perceived the performance
APPRAISAL
It is important in this work to consider the employees attitudes towards performance appraisal
itself and its feedback. In any appraisal system the mangers know more than the employees this
gives a form of reception on the part of the employees to the appraisal process. Employee‘s
attitude towards performance can also be change by making the appraisal system about them and
not about how the organisation can make money. In the two studies conducted by Levy and
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William in 1992 and 1998, there is a perceived knowledge in predicting appraisal reaction in
terms of job satisfaction and organisational commitment. The conclusion from the studies was
drawn as: The employees who believe they understand the appraisal system used in the
organisation are most likely to favour important organisational variables in the future and also
They are more accepting and largely favours the appraisal system and its feedback.
According to Mount 1984 for performance appraisal to be conducted in an effective manner and
for it to be accepted, the unique perceptive ability of both the employees and the mangers must
be taking into consideration. In summary for employees to have a positive attitude towards
The plan of the organisation should also deal with weakness rather than only
acknowledge strength
..
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2.9 EMPLOYEE ATTITUDE TOWARDS WORK
Employees have attitudes or viewpoints about many aspects of their jobs, their careers, and their
organizations and these view point play and important role in performance appraisal. The most
known employee attitude is job satisfaction. According to Locke (1976), employee attitude is
described as a pleasurable or positive emotional state resulting from the appraisal of one‘s job or
job experiences.
A lot of confusion and debates have been going on among practitioners on the topic of employee
attitudes. According to (Rynes, Colbert, & Brown, 2002), in a study of Human resources
professionals, there are three knowledge gaps in the area of employee attitudes. Namely
Analysing the first gap, the causes of employee attitudes, several studies have shown the
influences of a person‘s disposition on employee attitude and job satisfaction. (Staw & Ross,
1985) demonstrated in their study that a person‘s job attitude and satisfaction scores have
stability over time, even when he or she changes jobs or companies. (Staw, Bell, &Clausen,
1986).Also discovered in their own study that childhood temperament was found to be
According to Shane, & Herold, 1996 differences in attitude across employees can be traced, in
part, to differences in their disposition or temperament .Weiss and Cropanzano (1996) suggest
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that disposition may influence the experience of emotionally significant events at work, which in
turn influences work attitude and coherently job satisfaction. Also, in a related development,
Brief (1998) and Motowidlo (1996) have developed theoretical models in an attempt to better
There is also currently a heavy research on the influences of culture or country on employee
and found that the data grouped into four major dimensions and that countries, systematically
varied along these dimensions. The four cross-cultural dimensions are: (1) individualism-
collectivism ;( 2) uncertainty avoidance versus risk taking; (3) power distance, or the extent to
which power is unequally distributed; and (4) masculinity/femininity, more recently called
achievement orientation. In his research, the United States was found to be high on
individualism, low on power distance, and low on uncertainty avoidance whereas Mexico was
high on collectivism, high on power distance, and high on uncertainty avoidance. These
recognizing the importance of cultural causes of employee attitudes. (Saari, 2000; Saari &Erez,
2002; Saari & Schneider, 2001).have also proved that country/culture is as strong a predictor of
The issue of work situation should not be left out in terms of employee attitude, job satisfaction
and organization impact. Contrary to some beliefs, the most visible influence on employee
attitude and job satisfaction is the nature of the work itself—often called ―intrinsic job
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Jurgensen, 1978),have shown in their research that when employees are asked to evaluate
different facets of their job such as supervision, pay, promotion opportunities, co-workers, and so
forth, the nature of the work itself generally emerges as the most important job facet .this does
not rule out the impact of compensation programmes or effective supervision but instead it
proves that, more can still be done to influence employee attitude at work by ensuring that work
is as interesting and challenging as possible. It is very wrong to think that employees are most
desirous of pay to the exclusion of other job attributes such as interesting work situation .A study
by (Kovach, 1995). Examining the importance of job attributes, showed that employees ranked
interesting work as the most important job attribute and good wages ranked fifth, while managers
The 1930 Hawthorne studies, creates vivid awareness of the effects of employee attitudes on
performance. Shortly after the studies, came the notion that a ―happy worker is a productive
worker.‖ This notion became an interesting area of research for most researchers. Many of the
researchers however saw a weak relation between employee attitude and performance .Thus, the
conclusion that the presumed relationship between job satisfaction and performance was a
―management fad‖ and ―illusory.‖ became widely spread. Subsequent research on this proved the
earlier perception inadequate. Organ (1988) suggests that the reason why a strong relationship
could not be found between employee attitude and performance is as a result of the narrow scope
of the definition of job performance. Organ proposes that the definition of job performance
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should be made to include important behaviours not generally reflected in performance
appraisals, such as organizational citizenship behaviours, as such the strong relationship between
Judge and Watanabe (1994), in their modern research have exposed that there are three probable
forms of the relationship between employee attitude, job satisfaction and life satisfaction: (1)
spill over, where job experiences spill over into non-work life and vice versa; (2) segmentation,
where job and life experiences are separated and have little to do with one another; and (3)
fulfilment and happiness in his or her non-work life and vice versa.
Recent research has it in records that employees who are dissatisfied are more likely to quit their
jobs or be absent than employees who are satisfied. The three authors below all support this
view. (Hackett & Guion, 1985; Hulin, Roznowski, & Hachiya, 1985; Kohler & Mathieu, 1993).
Job satisfaction shows correlations with turnover and absenteeism. Job dissatisfaction also
grievances, and drug abuse, and decision to retire. Hulin et al. (1985) categorized these
individual withdrawal behaviours as evidences of ―job adaptation‖ and have suggested that these
individual behaviours be grouped together because the occurrence of most single withdrawal
behaviours is quite low, looking at a variety of these behaviours improves the ability for showing
27
the relationship between job attitudes and withdrawal behaviours (Hulin, 1991).Relying on the
research that shows job satisfaction predicts withdrawal behaviours like turnover and
absenteeism, researchers like Cascio, 1986; Mirvis & Lawler, 1977, have been able to
There are quite some researched methods for measuring employee attitudes, such as conducting
focus groups, interviewing employees, or carrying out employee surveys. Employee attitude
survey, seem to be the most accurate method of measurement, if well constructed. Thus, we first
provide an overview of the major research on employee attitude surveys. To correctly influence
employee attitudes in a positive way, some of the research already discussed need to be well
understood. Also, if employee attitudes are to be improved, cogent considerations for analysing
Two major research areas on employee attitude surveys are discussed below: employee attitude
measures used in research and facet versus global measures. The areas discussed are not meant to
provide knowledge of all relevant considerations for designing employee surveys, but rather
provide background on the research and an overview of some major areas of study. In the
research literature, the two most extensively validated employee attitude survey measures are the
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Job Descriptive Index (JDI; Smith, Kendall, & Hulin, 1969) and the Minnesota Satisfaction
1967). The JDI assesses satisfaction with five different job areas: pay, promotion, co-workers,
supervision, and the work itself. The JDI is reliable and has an impressive array of validation
evidence. The MSQ has the advantage of versatility—long and short forms are available, as well
as faceted and overall measures. Another measure used in job satisfaction research (e.g., Judge,
Erez, Bono, & Thoresen, in press) is an updated and reliable five-item version of an earlier scale
by Brayfield and Rothe (1951). All of these measures have led to greater scientific understanding
of employee attitudes, and their greatest value may be for research purposes, yet these measures
may be useful for practitioners as well. In practice, organizations often wish to obtain a more
detailed assessment of employee attitudes and/or customize their surveys to assess issues unique
to their firm.
One research area that identifies important areas for survey action is to link employee attitudes to
business outcomes. Schneider and his colleagues undertook recognisable research activity in this
area; their research was on how employee attitudes about various human resources practices
correlated with customer satisfaction measures, thus indicating key levers to improve customer
satisfaction. They found that when employees reported higher satisfaction with work facilitation
and career development, customers reported higher service quality (Schneider & Bowen, 1985).
Other researchers like, Wiley, 1996) developed a linkage models that identify the organizational
29
practices (as rated by employee attitude surveys) that relate to high levels of organizational
performance. A number of researchers like( Ashworth, Higgs, Schneider, Shepherd, & Carr,
1995; Colihan & Saari, 2000; Harter, Schmidt, & Hayes, 2002), have shown how employee
attitudes are predictive of important financial performance measures, such as market share
.Employee surveys, can be engines for improving employee attitudes and producing
organizational change. This statement is based on two important assumptions, first, that
employee attitudes affect behaviour and second, that employee attitudes are important levers of
organizational performance. There are many variations of survey feedback and action, though an
important research finding is that participation in feedback sessions alone will not result in
Conclusion
Although the literature on appraisal reaction lacks a theoretical framework, researchers have not
carefully considered how the various performance appraisal reactions might work together.
However, most research studies measuring one performance appraisal reaction tend to measure
The above literature still leaves us with a major question about what part does the feedback take
in performance appraisal? The above literature seems to support the fact that feedback especially
30
CHAPTER THREE
Unique Assurance Company is Nigeria‘s foremost insurance company, established in 1973. The
company engages in underwriting various policies, namely, motor, Fire, general accident,
Burglary, Workmen‘s Compensation, Contractor‘s All Risks, Erection All Risks, Machinery All
Risks, Money, Third Party Liability, Marine& Cargo, and Life insurances. Unique assurance
total assets are about 28 billion naira and paid up capital is 2.5 billion, which imposes confidence
In addition to this, Unique Assurance Company recognizes the power of staff and widespread
branches, as a key factor in its huge success, as such, has staff strength of about 900 employees
in a total of 20 branches located in various parts of Nigeria. Unique Assurance Company deals
with the best reinsurance and insurance companies worldwide such as Munich Re, Swiss Re,
American Intl Group, AXA Group, Allianz Worldwide, and Manulife Financial etc.
The complete process of performance appraisal in Unique Assurance Company has the following
key phases:
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• The Managers complete the forms
• The manager discusses with the concerned employee about the ratings
This process used by Unique Assurance Company is a combination of various techniques, using
ranking, setting of goals by employees in discussion with managers, providing for mutual
consent and agreement thus linking to the employee‘s career. The processes are well explained
under.
Step –1 Managers and employees are provided with the Appraisal Forms
The performance appraisal forms are given to all the managers and employees before the end of
the year. In the forms; there are various performance determinants like communication skills,
work quality, job knowledge, customer service, Problem solving and decision making ability,
team work, commitment to the job, punctuality and loyalty towards the organization . The
employee‘s readiness for promotion is also not left out. In The form, there are sections for
32
professional development plans and also the SMART objectives section, which means Specific,
Measurable, Achievable, Realistic and Time, bound. After which managers will have to record
Managers will fill the forms. The key performance factors are usually ranked from 1-5 with one
The manager and the employee will meet to discuss the manager‘s observations, which will
touch areas like the strengths of the employee, likely areas of improvement, future professional
development plan. The employee, is then given the freedom to exercise his or her choice, either
by agreeing or disagreeing with the manager‘s assessment and also making his own observations.
The two sides will then have to agree and finalize the assessment in order to proceed.
While discussing with the manager, the employee has the right to state his strengths and adjust
the rankings to his level. At this stage, if the manager disagrees with the employee, the matter is
33
• Setting goals for the employees, which also are in order with the company goals
• checking the performance of the employee against the previous goals, it‘s also a platform to
At this stage, an effective plan of action has to be put in place, regarding the employee‘s need of
Step-7 : Appraisal forms are sent back to HR Manager for appropriate action:
The response of the human resources manager is an important role in the appraisal issue, as some
influential decisions will be taken as regards the employee‘s salary, bonus and promotion, which
will have a tangible effect on the employee‘s career and attitude. These decisions are taken by
the HR based on the summary of the employee‘s performance, professional development plan
Documentation is very vital, it is as important as carrying out the appraisal itself, all appraisals
that an employee has had with the company are put in his/her file An employee‘s file has to
reflect all the appraisals and the career growth he/she has had with the company. It acts as a
34
The objectives this research aims to solve are:
-To investigate employee opinion on the evaluation of performance appraisal, analyze and
This thesis makes use of both quantitative and a qualitative research methodology approaches.
evaluated, theories and hypothesis are refined, technical advances are made. Quantitative
method of research. On the other hand, the qualitative method is collecting, analyzing, and
interpreting data by observing what people do and say. While quantitative research refers to
counting and measuring of things, qualitative research refers to the meanings, concepts,
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Comparism of quantitative and qualitative research approaches
-Quantitative seeks to confirm hypothesis about phenomena, while qualitative seeks to explore
phenomena
-In quantitative, Instruments use more rigid style of eliciting and categorizing responses to
questions, while in qualitative, Instruments use more flexible, iterative style of eliciting and
-Quantitative method uses highly structured methods such as questionnaires, surveys, and
-Quantitative method is usually used to quantify variation while qualitative is used to describe
variation
-Quantitative, is used to predict casual relationships, while qualitative is used to describe and
explain relationships
-The question format in quantitative is usually closed ended, while in qualitative it is open-ended
-In quantitative, participant responses do not determine which questions are asked next while in
36
Data collection
We collected the required information for this research work through primary and secondary
sources. Thex primary data was collected with the use of questionnaire and interview.Table3.1
Table 3.1
BRANCHES RESPONDENTS
(EMPLOYEES)
LAGOS STATE 1 10
OGUN STATE 2 10
OYO STATE 3 10
EDO STATE 4 10
RIVERS STATE 5 10
KANO STATE 6 10
SOKOTO STATE 7 10
ENUGU STATE 8 10
IMO STATE 9 10
EKITI STATE 10 10
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The questionnaire was designed in a concise and precise language to avoid ambiguity, and also
to arouse the respondents interest. The questionnaires consisted of well structured (close ended)
multiple choice questions, which just required ticking the right answers by the respondent. It also
consisted of unstructured (open ended) questions, which allowed respondents to answer to the
questions in their own words and freedom .we decided to use questionnaires, to allow responses
to be gathered in a standard way, bringing out objectivity, and reducing bias. Also, the use of
Anyway, the use of questionnaires is not without its limitations. Since questionnaires are issued
after the event being researched has taken place, there is the likelihood that many respondents
would have forgotten major parts in the events being researched. Another limitation is that of
distribution of the questionnaires, as it might not include all cadres of employees as some
employees were absent from work, while it was being distributed for various reasons.
As a supplement to the questionnaire, the interview method was also adopted to decode some of
the information that could not be accessed using the questionnaire. To this effect two
unstructured calls where placed to the managers of two branches of the company. The call lasted
about 10mintues.
SECONDARY DATA:-secondary data are those which have already been collected by some
other persons and have passed through some statistical processes. In this research, we consulted a
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VALIDITY AND RELIABILITY.
Validity and reliability are interdependent, thus if data is found to be unreliable there is no need
to test for validity. Validity is the extent to which data accurately reflects what they are meant to
reflect. There are some factors which can affect the validity of data, for example, if a respondent
is in a haste to complete. The questionnaire, the validity of his responses could be affected; also
Population actually means the totality of individuals, from which a sample is drawn. The
population of this work is made up of about 900 employees of Unique Assurance Company.
SAMPLE SIZE
Owing to the large size of the population, also due to the fact that the population is spread across
all the states of Nigeria, we decided to study only 10 branches, in 10 states of the federal republic
of Nigeria. the branches we studied are Lagos state, Ogun state, Oyo state, Edo state, rivers state,
Kano state, Sokoto state, Enugu state, Imo state and Ekiti state.
For the purpose of simplicity, we further decided to study 10 employees in every branch listed
39
METHODS OF DATA ANALYSIS
Tables and simple percentages were used in analyzing the variables. for the test of hypothesis;
CHI-SQUARE (χ2)
This is a non-parametric test, which is used in testing the relationship or association of a group.
Level of Significance
For this study, the level of significance is 5%.This means that we are 95% confident that the
40
CHAPTER FOUR
INTRODUCTION
This chapter deals with the presentation and analysis of the data collected. The formulated
hypothesis will be tested for acceptance or rejection, using tables and statistical methods.
assurance company. Out of the hundred questionnaires distributed, only 80 were answered
MALE 56 70
FEMALE 24 30
TOTAL 80 100
TABLE 4.2.1 shows that 56 individuals representing 70% of the respondents are males while 24
From the questionnaire 19 persons representing 23.7% of the respondents are within the age of
20-30 years.37 persons representing 46.3% of the respondents are within the age of 31-40 years
41
while 17 persons representing 21.3% of the respondents are within the age of 41-50 years.7
RESULT: 17 persons representing 21.3% of the respondents agreed that the result of
performance appraisal is a true reflection of their ability, while 63 persons representing 78.7% of
the respondents said that the result of performance appraisal is not a true reflection of their
ability.
RESULT: 15 persons, representing 18.75% of the respondents, saw the performance appraisal
system as unfair, while 65 persons, representing 81.25% of the respondents saw the system as
fair.
PERFORMANCE APPRAISAL
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Result: shows that 60 persons, representing 75% of the respondents, see an improvement in the
organization due to performance appraisal, while 20 persons, representing 25%, do not see any
APPRAISAL
RESULT: shows that 76 employees, representing 95% of the respondents, have witnesses
employees, representing 5%, have not noticed positive changes in their attitude to work as a
RESULT: shows that 50 persons, representing 62.5% agreed that the company followed the
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RESULT: depicts that 66 employees, representing 82.5% of the respondents agreed that
performance appraisal should be linked with promotion, while 14 employees, representing 17.5%
of respondents, did not agree that performance appraisal should be linked with promotion.
RESULT: shows that 47 persons, representing 58.75% of respondents do not agree that
performance appraisal should not be linked with remuneration, while 33 persons, representing
RESULT: shows that 56 employees, representing 70%, have their managers communicating
occasionally with them during the year, 16 persons, representing 20%, have their managers
communicating with them frequently, while 8 employees, representing 10%, have their managers
IMPACTS?
RESULT: shows that 72 employees, representing 90% of the respondents believe that
performance appraisal has more positive impacts to offer employees than negative impacts,
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QUESTION 10: DO YOU AGREE THAT PERFORMANCE APPRAISAL BRINGS
RESULT: shows that 77 employees representing 96.25% of the respondents believe that
performance appraisal causes unhealthy competition among staff, while only 3 employees,
RESULT shows that 70 persons, representing 87.5% did not receive adequate training and
information before the appraisal exercise, while 10 persons, representing 12.5% received
adequate training
AND DEVELOPMENT
RESULT: shows that 56 persons representing, 70% of the respondents see performance
appraisal as the company‘s interest in their individual performance and development while 24
persons, representing 30% of the respondents did not see performance appraisal as the
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QUESTION 13: DO YOU THINK THAT PERFORMANCE APPRAISAL
RESULT depicts that 11 persons representing 13.75% of the respondents believe that
performance appraisal encourages good team spirit, while 69 persons, representing 86.25%
believes that performance appraisal does not encourage good team spirit.
RESULT shows that 58 employees, representing 72.5% think that performance appraisal results
in job specialization and perfection, while 22 employees, representing 27.5% think that
The hypothesis, which were stated earlier in chapter one, would be tested in this chapter for
acceptance or rejection. All the hypotheses are to be tested using the Chi square (χ2) model thus:-
χ2 =Σ (O-E) ²
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TEST OF HYPOTHESIS ONE
For the purpose of clarity, the hypotheses are hereby restated thus:
H1: The changes in the attitude of employees is not as a result of performance appraisal.
Questions 3was used in analyzing this hypothesis, using the chi-square (χ2) model thus:
Table 4.2.2
Hypothesis One
O E (O-E) ²
4 40 32.4
76 40 32.4
χ2 =64.8
The table value of expected (χ2) at df of 1 and alpha level of 0.05 is equal to 3.841
The Chi-square (χ2) calculated values of 64.8 are greater than the table value of 3.841 at df of 1
and 0.05 alpha level. Therefore, the null hypothesis (H0) which says that the attitude or the
47
behaviour of employees has not changed as a result of performance appraisal is REJECTED.
Hence the alternative hypothesis (H1), which states that the attitude or the behaviour of
H0: Performance appraisal is believed to have more negative effects on employees than positive
effects
H1: Performance appraisal is believed not to have more negative effects on employees than
positive effects
Questions 14 is used in analyzing this hypothesis using the chi-square model thus:
O E (O-E) ²
8 40 25.6
72 40 25.6
χ2=51.2
The table value of expected (χ2) at df of 1 and alpha level of 0.05 is equal to 3.84
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ACCEPTANCE/REJECTION OF HYPOTHESIS TWO
The Chi-square calculated value of 51.2 is greater than the table value of 3.841 at df 1 and 0.05
alpha level. Therefore the null hypothesis (H1) which states that performance appraisal has more
negative effects on employees than positive effects is REJECTED. Hence, the alternative
hypothesis (H1) is accepted, this means that performance appraisal has more positive effects on
H0: Performance appraisal does not bring unhealthy competition among employees
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Table 4.2.4
Hypothesis Three
O E (O-E) ²
3 40 34.225
77 40 34.225
χ2=68.45
The chi-square (χ2) calculated value of 68.45 is greater than the table value of 3.841 at df of 1
and 0.05 alpha level. Therefore the null hypothesis (H0), which states that performance appraisal
does not bring unhealthy competition among employees, is REJECTED. Hence, the alternative
hypothesis (H1) is ACCEPTED, This means that performance appraisal brings about unhealthy
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Hypothesis Four
Table 4.2.5
O E (O-E) ²
11 40 21.025
69 40 21.025
χ2==42.05
The Chi-square calculated value of 42.05 is greater than the table value of 3.841 at df of 1 and
0.05 alpha level. Therefore, the null hypothesis (H0) which states that performance appraisal
encourages good team spirit is REJECTED. Hence, the alternative hypothesis (H1) is
ACCEPTED. This means that performance appraisal does not encourage good team spirit.
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CHAPTER FIVE
INTRODUCTION
This chapter deals with the discussion on the findings of the analysis of the data collected.
5.1 FINDINGS
1) That the performance appraisal system of Unique Assurance Company believe it is fair,
and follows performance appraisal system policies and procedures. This puts enough
confidence of objectivity into the minds of the employees. This finding might not be
correct for another company but with our representation of Unique Assurance Company,
2) There have been positive changes in the attitude of employees towards work and the
changes are evident in work quality, job specialization, meeting deadlines. All these are
3) The fact that performance appraisal was linked to remuneration was generally not
accepted. when followed up with an oral interview, our findings were that linking
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employees would not want to admit their work problems, knowing fully well that their
4) Communication between managers and their subordinates, over their job performances
during the year was mostly done occasionally; as such most employees were left in the
dark about their job progress during the year before the performance appraisals.
5) Our findings suggest that performance appraisal should be encouraged as it was proved
that performance appraisal has more positive impacts on employees than negative effects
employees, as it is now seen as a race in which a winner must emerge. This belief can
reduce work quality and at the same time eliminate team spirit.
7) Most Employees did not receive adequate training and information about the
performance appraisal exercise before it starts, as such they did not know what exactly to
expect.
job result .as the staff performs the job year in year out ,the performance appraisal results
5.2 RECOMMENDATIONS
Based on the findings stated above, the following were the recommendations of the study:-
be willing to admit their work faults and weaknesses, thereby willing to improve. Linking
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judgemental, and punitive, instead of the initial idea of encouragement to employees,
2) More communication between managers and their subordinates, over the subordinate‘s
job progress during the year, should be encouraged. This will give the employee a sense
of belonging and as such will work hard to implement improvements, neglect weaknesses
3) Employees should be given adequate training and information about the appraisal
exercise before it starts, so that the whole exercise will not look new to them. This will
enable employees to know their roles and mission in the organization better. The idea that
performance appraisal is a competition among employees will also be removed from the
5.3 CONCLUSION
From our research, it can be clearly seen that performance appraisal comes with a lot of benefits
and packages for both the employees and the organization as a whole. The validity of this claim
was tested in the first and second hypothesis of our research (hypothesis1&2).however it should
not overruled that performance appraisal also has its shortcomings or negative effects towards
the employees and the organization as a whole, though it seems that the positive effects outweigh
the negative effects. The validity of this claim was tested in the third and fourth hypothesis of our
research (hypothesis 3 & 4).it is therefore evident from our research that performance appraisal
is a phenomenon that should be warmly embraced by all organizations, globally, to achieve good
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REFRENCES
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York, NY
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Murphy and F.E Seal (Eds) Psychology in Organisations Integrating Science and
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Appraisal Processes And employee Reactions :A Meta-Analytic Review Of Field
o Derven, M.G., (1990 February) ―The Paradox of. Performance Appraisals‖, Personnel.
Journal, volume 69
o Fielder, F.F. ,&House, R.J (1988) ―Leadership Theory and Research. A Report In
Organizational Pschology‖,73-79
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o Judge, T. A., & Watanabe, S. (1994). ―Individual differences in the nature of the
relationship between job and life satisfaction.‖ Journal Of Occupation and Organisation
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networks from grid digital elevation models: a review and a new method comment..
Hall.
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o Mullins, L. (2006) ―Essentials of organizational behaviour.‖ Harlow: Prentice
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o Saundra J. Reinke (2003)‖Does the Form Really Matter? Leadership Trust and
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Review, "Readings in Organizational Behavior and Human Performance, eds. W. E.
and Management Practice. In J.W. Smither (ED)Performance Appraisal State Of the Art
o Staw, B. M., Bell, N. E., & Clausen, J. A. (1986).‖The dispositional approach to job
o Taylor, M.S, Tracy, K.B. Bernard, M.K., Harrison ,J.K and Carrol S.J.(1995) ―Due
o Wall, B., R.S. Solum, and M.R. Sobol. 1992. ―The Visionary Leader‖. Rocklin,
59
LIST OF TABLES
Table 3.1 Breakdown of Questionnaire Statistics-----------------pg 34
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APPENDIX A
Dear respondents,
We are students of the School of Management Blekinge Institute of Technology Sweden
writing our masters‘ thesis on the topic: Attitude Of employees to work Performance. Find
attached here, a copy of the questionnaire we have designed to get your response on issues
related to this topic. We will really appreciate it if you spend a few minutes of your time filling
this questionnaire.
Your response is important and will enable us to make proper analysis of our research. Your
response shall be treated confidentially and anonymously. I kindly request you to complete this
questionnaire honestly.
Thank you for your assistance as I anticipate your response.
Awosanya Olasunkanmi, Demola Oyewunmi
CONTACT DETAILS:
STUDENT
Olasunkanmi awosanya,
Oyewunmi Ademola
+46762720827
61
QUESTIONNAIRE
INTRODUCTION: Please kindly indicate your preference among alternative answers for each question by
ticking in the appropriate box. Where alternative answers are not provided, fill in the gaps provided.
1) SEX
a) Male
b) Female
2) AGE
a) 20-30 years
b) 31-40 years
c) 41-50 years
d) Above 50 years
3) EDUCATIONAL QUALIFICATION
a) WAEC/GCE
b) OND/NCE
c) BSC/HND
d) MBA/MSC
e) PHD
4) CADRE
a) Junior staff
b) Senior staff
c) Management staff
a) Yes
b) No
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6) DO YOU CONSIDER THE PERFORMANCE APPRAISAL SYSTEM IN YOUR COMPANY FAIR
a) Yes
b) No
a) Yes
b) No
8) HAS YOUR ATTITUDE TOWARDS WORK AND THE ORGANIZATION CHANGED AS DESIRED AS A
RESULT OF THE PERFORMANCE APPRAISAL
a) Yes
b) No
9) FROM YOUR OWN PERCEPTION, DO YOU THINK THAT UNIQUE ASSURANCE COMPANY FOLLOWS
THE PERFORMANCE APPRAISAL SYSTEM POLICIES AND PROCEDURES STRICTLY
a) Yes
b) No
10) DO YOU THINK THAT PERFORMANCE APPRAISAL SHOULD BE LINKED WITH EMPLOYEE
PROMOTION
a) Yes
b) No
11) DO YOU THINK THAT PERFORMANCE APPRAISAL SHOULD BE LINKED WITH EMPLOYEE
RENUMERATION
a) Yes
b) No
12) HOW OFTEN DID YOUR MANAGER COMMUNICATE WITH YOU ON YOUR JOB PERFORMANCE
DURING THE YEAR?
a) Frequently
b) Occasionally
c) Never
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13) FROM YOUR OWN PERCEPTION, WHICH IS MORE: THE POSITVE IMPACTS OF PERFORMANCE
APPRAISAL ON EMPLOYEES OR THE NEGATIVE IMPACTS?
a) Positive
b) Negative
14) DO YOU AGREE THAT PERFORMANCE APPRAISAL BRINGS ABOUT UNHEALTHY COMPETITION
AMONG EMPLOYEES
a) Yes
b) No
15) DO YOU RECEIVE ADEQUATE TRAINING AND INFORMATION ABOUT THE PERFORMANCE
APPRAISAL EXERCISE BEFORE IT STARTS
a) Yes
b) No
16) DOES PERFORMANCE APPRAISAL SUGGEST TO YOU THAT THE COMPANY IS GENUINELY
INTERESTED IN YOUR INDIVIDUAL PERFORMANCE AND DEVELOPMENT
a) Yes
b) No
17) DO YOU THINK THAT PERFORMANCE APPRAISAL ENCOURAGES GOOD TEAM SPIRIT
a) Yes
b) No
18) DO YOU THINK THAT PERFORMANCE APPRAISAL BRINGS ABOUT JOB SPECIALISATION AND
PERFECTION
a) Yes
b) No
19) WHEN FACED WITH A LOT OF MISTAKES FROM YOUR JOB DURING THE YEAR,DURING
PERFORMANCE APPRAISAL ,HOW DO YOU FEEL--------------------------------------------------------------------------
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